... But let me try. I just got dsl through at&t and supplied my own modem versus buying one of thier super expensive ones. Initial setup with my iMac (10.8) was a breeze. The modem is a bridge only modem so the Mac handles the PPPoE sign in. Now, let me try to throw a router in the mix. I cannot for the life of me get the Mac to accept a wiresz connection over my dsl. Let me get detailed. The first router I tried was one of those travel routers with only one port that works as either WAN/LAN depending on the mode you choose. To set it up you have to connect it to the Mac, assign a static IP address first, then access the configuration page. I configure it for "router" and it even gives the option to choose PPPoE connection and enter my credentials. Once it reboots however, the configuration page is no longer accessible. Either way I also reboot the modem, connect the modem to the WAN port on the router, and it's if they never sync. As if the router isn't handling PPPoE like it should. The Mac says I'm connected to wifi but with no Internet. So it runs diagnostics, asks me to enter my name and password again (even though the router should handle that) and when I click continue, boom, it goes right back to "connection type" menu and I'm not even connected to the router at all anymore. So I think, hey, why don't I just try a normal wireless router with a WAN and four LAN ports. It also has the option to enter my PPPoE name nd password, and I do. I can connect to the Internet with this router, however only my over Ethernet. Still can't get wireless to work. I go through the same mess as the first router and then I lose all connection again.

Break.

Ok I'm back. So I work for at&t and someone says to me today, "hey why don't you just get a modem wireless router combo from one of the installers?" I went the easier route and just picked one up out of the supply room. Couldn't wait to get home and try it out! Setup was easy, connected to Internet, enabled wireless, connected my Mac to wifi and pulled the plug (Ethernet that is.) Instant connection loss. My iphone and ipad are connected. What in the wide world of sports is going on with my iMac?!? This is my first experience with dsl but wow I didn't think I'd be pulling my hair out to this extent. Please guys give me some feedback or direction. I've scoured the web with nothing to show. Oh yeah I even tried putting the other routers in bridge mode and let the Mac handle PPPoE. Any help is greatly appreciated and thanks for reading all the way through this. I tried to be thorough.

Your second attempt seemed to work OK for your iDevices but if you lost connection on your iMac, then you should either reboot with the LAN disconnected or wait till System Preferences>Network shows that there is a valid WiFi connection. Sometimes there is a lag.

What you need to do is to ensure that you have the following working :

Personally I let Apple Airport units do #2 and use a Draytek Vigor ADSL modem for #1.
Tomorrow, my ISP is coming to install a VDSL Modem/WiFi Router. When they have gone, I'm going to disable their WiFi and their Router and just use their new box as a VDSL Modem. Hopefully the connection setup will still be easy (will still be a PPoE session). The reason I mention it is that you seems to be doing much the same.

Thanks for the replies. I went a step further and just deleted wifi altogether from the left pane of network settings. Then I created a new one and renewed the dhcp lease and voila! Working at least for now.

Let me know how that goes. It's weird that it shows I'm connected wirelessly, but when I unplug Ethernet, it instantly changes to the wireless symbol with an exclamation, saying I have to Internet.

Change over went without problems. Disabled the VDSL unit's WiFi and put it into LAN Bridge mode. Just swapped the phone connection with the Draytek Vigor and everything carried on as normal. Download speeds more than x2. Upload speeds more than x5.